A turbine near Lake George, north of Canberra. In a radio interview the prime minister said windfarms were 'sprouting like mushrooms all over the fields of our country'. Photograph: David Gray/Reuters

Tony Abbott has signalled next year’s review of the renewable energy target could wind back, or even scrap, the scheme, saying lower power prices are the government’s primary goal and the rationale for the RET no longer exists.

Announcing modest government assistance for Holden, the prime minister also revealed he would chair a new taskforce to find ways to make industry more competitive, with reducing the cost of energy a primary aim.

Asked whether that could involve scaling back the RET, which was set up by the Howard government and requires energy retailers and large customers to source a proportion of their energy from renewable sources, Abbott said: “We support sensible use of renewable energy, and as you know it was former Howard government which initially gave us the RET and at the time it was important because we made very little use of renewable energy.”

But times had changed, he said.

“We have to accept that in the changed circumstances of today, the renewable energy target is causing pretty significant price pressure in the system and we ought to be an affordable energy superpower … cheap energy ought to be one of our comparative advantages … what we will be looking at is what we need to do to get power prices down significantly,” he said.

Abbott said he would also “consult closely” with his Business Advisory Council, chaired by Maurice Newman, as the taskforce looked for ways to increase industry competitiveness.

Newman has previously called for the RET to be scrapped because he believes the scientific evidence for global warming and the economic case for renewable energy no longer stack up.

The former chairman of the ABC and the Australian Securities Exchange said persisting with government subsidies for renewable energy represented a “crime against the people” because higher energy costs hit poorer households the hardest and there was no longer any logical reason to have them.

Newman acknowledged Coalition policy was to retain the current target to generate 20% of renewable energy by 2020, at least until the review was held, but told Guardian Australia in his opinion “the whole science on which this is based is somewhat in tatters”.

He has supported a “landscape guardians” group opposing new windfarms in the southern highlands south-west of Sydney, and was one of a group of landholders who have threatened to sue a neighbouring farmer for "substantial damages" if their health or property values are harmed by his agreement to allow wind turbines to built on his property.

Abbott said in a radio interview he understood why people were anxious about windfarms that were "sprouting like mushrooms all over the fields of our country".

“If you drive down the Federal Highway from Goulburn to Canberra and you look at Lake George, yes there’s an absolute forest of these things on the other side of the lake near Bungendore,” he said.

“I absolutely understand why people are anxious about these things that are sprouting like mushrooms all over the fields of our country. I absolutely understand the concerns that people have.

“And I also understand the difficulty because while renewable power is a very good idea at one level, you’ve gotta have backups because when the wind doesn’t blow and the sun doesn’t shine, the power doesn’t flow. So this is an obvious problem with renewable energy in the absence of much more sophisticated battery technology than we have right now.”

According to the Australian Energy Market Commission, the RET makes up less than 1% of the average household electricity bill.